Throughout history war has had a resounding effect on the banking sector and how people store and generate value. It’s no surprise that war is big business for those who are in the industries that support these actions. While the effects of conflicts on banking seem obvious there’s a lot more going on under the surface.
The history of banking and war is a complex journey down the evolution of money. Since the creation of money and the gold standard, conflicts have caused nations and societies to alter how they conduct economic activity. Here’s an in-depth look at how war continues to shape the banking experience for millions around the globe.
Conflicts Cause Disruptions in Banking
Anytime a major conflict erupts, there are disruptions to everyday life. The banking sector is not immune to these actions and they are often one of the first to suffer during conflict. Banking becomes a less attractive job when there is little order in the region and you are sitting at a corner between funding and those seeking to remove it.
Additionally, there are major changes to the centralized banking system that occur when wars start. The entire reason the world is off of the gold standard is due to the world wars and the Vietnam conflict. Here are some of the reasons why DeFi could be the perfect fit in these circumstances.
Infrastructure Losses
One of the first areas to get targeted in a conflict is infrastructure. Electrical grids, transportation networks, and fuel systems are often destroyed to prevent the enemy from using them. Sadly, these are the same resources the civilian populations need to conduct daily activities.
When there is a loss of infrastructure, there is little chance of providing banking to the community. Your local branch can’t operate without full utilities. As such, online banks and DeFi options offer better solutions. They can provide everything you need to conduct daily commerce securely.
Notably, it’s for this reason that DeFi has seen a surge in developing nations. It’s much easier to provide DeFi education and smartphones versus a traditional banking setup in many developing nations. As such, DeFi is now soaring in popularity in many African and South American regions.
Currency Fluctuations
Another issue worth mentioning is that the nations in the conflict can have their currencies fluctuate violently. There are many instances in history where a country has lost a conflict and its currency has become worthless.
DeFi systems provide relief from these concerns because they are agnostic. DeFi assets like META 1 Coin are not issued or controlled by a government. As such, they remain the best option for the average person to store wealth during conflicts.
Gold was the original solution to this problem. However, the average person can’t secure and transport gold realistically. Additionally, today’s digital economy requires digital assets. DeFi services can provide borderless access to financial services which makes them the ideal solution for millions of unbanked people currently.
Examples of Banking Left in Shambles After Conflict
You don’t have to travel too far back to find examples of countries’ banking systems collapsing during conflict. There are plenty of recent examples that showcase just how delicate a fractional reserve banking system is in these circumstances. Here are a few prime examples of conflict destroying local banking systems
Iraqi Dinar
The invasion of Iraq by a coalition of countries in the 90’s helped Kuwait regain control over its lost territory. It also led to the eventual capture and killing of Saddam Hussein, Iraq’s dictator. The conflict also resulted in the Iraqi dinar becoming worthless.
Those in the country that attempted to store their wealth were forced to resort to gold, art, jewelry, and USD as their only options. Many people were unable to convert their dinar in time and lost their life savings.
Today savers are smarter and aware that they need to diversify their assets. DeFi networks that are specifically built to generate wealth and store value such as the META 1 Coin offer more reliable solutions to the market.
Ukraine
The ongoing conflict in Ukraine has led to some interesting developments in the crypto sector. Ukraine recently voted to allow cryptocurrency usage as a way to open the door for millions in crypto donations that were sent by donors.
The maneuver showcased how cryptocurrencies can help those living in war-torn regions conduct business. The main difference between the Iraq and Ukraine conflicts in regards to currency is that the Ukrainians now have blockchain assets such as Bitcoin and META 1 Coin to store value effectively.
Sudan
According to recent reports, many Sudanese citizens have now been locked out of their fiat savings accounts following a 10-day cease-fire in the country. The nation has been caught in brutal infighting after Sudanese army chief Abdel Fattah al-Burhan and former deputy Mohamed Hamdan Daglo began attacking each other.
The local citizens have reached out on social media to attempt to gain access to their fiat funding. This news highlights the fragile nature of a centralized banking system in terms of being able to protect the average person.
In comparison, non-custodial DeFi networks never hold your funds. They place you as the only person who can access these assets using a private key. Even developers have no way of accessing your account without a private key when using these advanced systems. In this way, you are protected from government seizures and delays.
How DeFi Fills the Void Left After Conflict
There are many reasons why DeFi is the perfect solution during and after any conflict. For one, there is minimal infrastructure needed to operate these systems. DeFi networks only require smartphones and the internet. Thanks to the proliferation of high-speed and satellite internet, these services are now globally available.
DeFi banks are already helping the underbanked of the world access funding when they need it most. The cool thing about these networks is that they operate in a permissionless manner with no gatekeepers.
Structure Matters
The difference in the structure between a DeFi bank and a regular bank is immediately obvious when you open an account. In a normal banking solution, you need to provide a lot of personal information to meet regulatory requirements. Sadly, these requirements are too much for refugees and others in war-torn areas to provide. As such, they often are left out of the loop in terms of basic financial services.
DeFi banks are open to anyone in the world to use. These protocols operate as pure code. There are no gatekeepers to please or human emotion or prejudice. In most instances, you simply connect your network wallet to begin using these services.
Streamlined Onboarding
One of the biggest developments in the market lately is the integration of fiat to crypto direct onramps. These portals make it easy to take your fiat and convert it to cryptocurrencies in seconds without having to use a third-party exchange or another service.
The Onramper portal used by the META 1 Coin is a prime example of this technology working. The system supports the conversion of +50 fiat currencies into cryptocurrencies. Users can access the portal from any smart device in 150 countries. This flexibility makes it ideal for the approximately +3 billion unbanked individuals in the world.
The People Can Be the Bank
DeFi changes the game by enabling you to be the bank. DeFi services replace banking personnel with smart contracts. Network nodes act as the transaction approval team. These systems bring a huge amount of benefits to the table.
For one, they are more efficient. You don’t need a location, or operating budget to use these systems compared to a traditional banking setup. Also, the users share in the protocols profits. This structure is fairer for everyone.
The Hard Truth
Your local bank isn’t there to help you succeed. They have shareholders and their primary purpose is to generate revenue for them. This revenue is generated from you. As such, you’re the bank’s customer and they feed off of your actions. They lend out your money and they ensure APYs by doing so.
Sadly, this structure should mean that you gain access to some of these returns. Unfortunately, the centralized nature of the banking industry has led to only the shareholders profiting. Additionally, the continued melding of politics and banking has led to multiple bailouts of a system that lacks any sustainability.
DeFi offers the Best Solution
DeFi banks offer a refreshing break from the politically motivated centralized banking system. As the conflict continues to expand and financial services are weaponized, there are a growing number of people who are left out of the loop simply due to the country they live in. The best option is to create a financial system that isn’t beholden to any nation and offers its service to all equally.
Store Wealth More Efficiently
One of the main reasons why DeFi is the perfect banking solution for the future is the ability to store wealth. The DeFi market doesn’t rely on inflationary assets like fiat currency to store wealth. Instead, these networks have advanced blockchain options to consider.
Safehaven DeFi Networks
The introduction of safehaven tokens has created a buzz in the market due to their focus on storing wealth. Safehaven tokens take the best aspects of stablecoins and cryptocurrencies and add long-term protections. These tokens aren’t made to trade every day like Bitcoin, although they can be, they’re designed to store wealth.
The prime example of a safehaven token in operation today is the META 1 Coin. This advanced decentralized asset offers a unique combination of protections that make it stand out against the crowd.
The first thing worth mentioning is that the token isn’t tied to the volatile market. It gets its value from a reserve asset. The developers used a basket of gold-related assets to ensure the token remains stable even while the rest of the market experiences massive shifts in value. The token recently proved its stability during the last market crash which left many projects down 60%.
Value Increase
META 1 Coin holders experience a 1.3% increase in value. This increase helped to prove the concept of a stablecoin and how it could be used to beat inflation and other major issues hurting the average saver,
META 1 Coin is the main token for the METANOMICs DeFI ecosystem. This all-inclusive protocol provides savers and traders with everything they need to prosper. The system begins by making it easy to join and exit. Anyone can use the onramper portal to join.
You can also spend your crypto rewards just like fiat currency at any MasterCard-accepted retailer. This flexibility means that users can leverage the DeFi ecosystem to generate wealth without causing any major delays or disruptions to their current savings strategies.
The META VAULT
The META VAULT is one of the easiest ways for a new user to secure passive return. The VAULT operates like a traditional bank. The main difference is that you use the inflationary-resistant asset META 1 Coin rather than fiat currency. META VAULT users enjoy high security on their holdings. They also qualify for rewards which makes it simple to get results.
Prevent Centralization
One of the biggest worries for decentralized projects is that they will get usurped and centralized by groups. To present this risk, the META 1 Coin developers have blocked all corporations and trading firms from the economy. This step lowers trading volume which improves long-term results.
The protocol also prevents market dumps by introducing an asset value requirement. All tokens must trade for minimum asset value to complete. This step has helped the token continually generate value, even during volatile market conditions.
DeFi Can Help Bring Peace and Prosperity
The DeFi revolution is about tearing down boundaries and enabling anyone to generate wealth and access basic financial services. Projects like META 1 Coin demonstrate the importance of making your service open globally. You can expect to see DeFi continue to expand as more people see it as the obvious solution to the current situation.